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By Jake Lingeman
Managing Editor
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Before the COVID-19 pandemic, automakers were in the habit of announcing grand plans stretching 20, 30 years in the future. Almost all of them centered on their future battery-electric vehicle (BEV) portfolio.
Nissan, in May 2020, announced its vision in Nissan Next, an ambitious plan to "achieve sustainable growth, financial stability and profitability" by the end of March 2023.
Over those three years, virus-related work stoppages, production slowdowns and supply chain shortages plagued Nissan, as they did nearly every business on the planet.
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In the ensuing years, consumer behavior changed. Buyers became used to paying more for new and used cars, ordering a model and waiting for it to arrive became more commonplace at U.S. dealerships and the BEV revolution that was supposed to arrive never showed up.
Nissan needed to change its plan and it wasn't the only one. Ford and Mercedes have both slowed down their electric vehicle rollouts, among others.
Toyota, which was heavily criticized as dragging its feet as the market sped toward BEVs, currently offers a robust portfolio of hybrids that its representatives are quick to point out are more desired by customers.
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By November 2021, a new plan was in place. Nissan Ambition 2030 was announced as the company's new long-term vision for mobility.
In March, Nissan revealed The Arc, a bridge plan between Nissan Next and Nissan Ambition 2030 that aims to produce vehicles more efficiently resulting in lower costs to customers, all while the parent company makes more money. It also zeros in on the electrified vehicle/internal combustion engine product portfolio, with plans to balance offerings.
"The past few years have been difficult for all original equipment manufacturers, but Nissan has struggled more than most financially, finding the right balance between supply and demand, and getting new products to market. Inventories were low for all automakers coming out of the pandemic, but since then, Nissan's inventory has risen to among the highest in the industry at north of 100 days supply," Paul Waatti, director of industry analysis at AutoPacific told Newsweek.
In January, Vinay Shahani was tapped to lead Nissan's marketing and sales teams in North America, spearheading the public-facing side of The Arc. The senior vice president of marketing and sales has 20 years of varied automotive industry experience ranging from product planner at Ford Motor Company to vice president and marketing lead at the North American offices of the Volkswagen, Toyota and Lexus brands.
He is charged with the revitalization of Nissan sales. In 2017, the company sold 1.6 million units, twice the 834,000 sold in 2023.
"I started on the technical side of the business. I got a degree in mechanical engineering, and that's where I wanted to start was designing cars. But, over my 30-year career, I've really come to love the commercial side of the business. I will tell you my most exciting thing is to build an emotional connection between a brand and a consumer. That's what I really love to do," Shahani told Newsweek.
Shahani has his work cut out for him. Since 2020, new car prices have risen by 30 percent, while average American households needed an annual income of at least $100,000 to afford a car if they're following standard budgeting advice, Newsweek reported in April.
To meet those consumers Shahani put together the "six under $30K" campaign combining its six least expensive vehicles for a full-court marketing push on regional TV spots and social media.
The lowest-priced Nissan is the Versa car. It starts at just $16,680. The Altima, Sentra and electric Leaf cars, and Kicks small SUV also cost less than $30,000. Nissan's two-row, family-friendly Rogue SUV, a competitor to the Toyota RAV4 and Honda CR-V, starts at $28,850. That SUV has been Nissan's best seller in the U.S. for years.
"Nissan has a strong presence in the sub-$30k range, but the upper end needs revitalization. A barrage of key redesigned and refreshed products is coming over the next 12 to 18 months, and they can't arrive soon enough to get Nissan back on track," said Waatti.
He added that Nissan needs to capitalize on the current desire for hybrids in the market. It currently has none for sale, though it does have hyper fuel-efficient options for customers like the Altima sedan at 39 miles per gallon (mpg) on the highway. Toyota has already capitalized on that desire with a Camry hybrid that now gets 53 mpg highway.
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Those are the vehicles of today. Nissan is also working on the vehicles of the future. The automaker aims to bring its BEV prices in line with traditional vehicle costs. Currently the average transaction price overall is about $48,000 while the average EV transaction price is around $56,000. At Nissan dealerships buyers can find a Rogue SUV under $30,000 but the similarly-sized Ariya is about $40,000
To do that, Nissan plans to leverage modular platforms, reducing costs by using the "family of vehicles" approach, which decreases the number of varieties of parts. Additionally, the approach shortens development lead time and the production time per vehicle at the plant. Other automakers such as Volkswagen and Toyota already take this approach.
Assembly plants and their workforce will change as The Arc plan is implemented. The Nissan Intelligent Factory concept introduces increased automation in the production process. Nissan currently has about 15,000 employees at plants in the U.S. It's senior VP of manufacturing told Automotive News in May that long-term headcount will stay flat or increase with EVs.
The concept also allows for more production flexibility, meaning Nissan will be able to better and more quickly respond to consumer demand.
"Current market conditions are volatile, and automakers are working to find the proper cadence for electrification rollouts to meet actual market demand. Nissan has been playing defense, changing course on future plans on multiple occasions, most recently putting a hold on BEV plans at its Canton plant in Mississippi," said Waatti.
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"While being agile and able to pivot through changing market dynamics is beneficial, indecision can be as detrimental as an overcommitment if not executed carefully. At some point, the rubber has to meet the road," he said.
Shahani agrees that it's the consumer who decides where the market goes. Nissan's midterm plan will bridge the company from today's market to a future driven by more electrification and technology.
"We're a full-line manufacturer, and our model range includes trucks, sports cars, sedans, crossovers, and sport utilities. That lineup includes powertrain diversity with both internal combustion and battery electric vehicles today, and we'll soon be expanding into e-power and plug-in-hybrids," said Shahani.
He says Nissan has more to come this year including new Murano and Armada SUVs and the compact Kicks, and that the company is focused on differentiating its lineup where consumers notice it the most.
Shahani also says that while Nissan supports and encourages incentives that can help drive broader adoption, it also needs to focus on greater consumer education on the benefits of EVs, as well as the availability of charging infrastructure.
"The Arc plan is really about delivering what the customer wants, both now and in the future. We will continue to introduce new models geared to meet the demands of the market, with ICE, HEV, PHEV and EV all in the pipeline over the next three years. In addition, The Arc includes investments in new customer-focused initiatives that are designed to retain customers within the Nissan family," he said.
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